Department of Alcoholic Beverage Control v. Alcoholic Beverage Control Appeals Board

The Department of Alcoholic Beverage Control (Department) has exclusive licensing authority over entities that sell alcoholic beverages. Its procedures for adjudicating whether licensees have violated the *5 terms of their licenses include an evidentiary hearing at which a Department prosecutor makes the Department’s case to an administrative law judge (ALJ), and a second level of decisionmaking in which the Department’s director or a delegee decides whether to adopt the ALJ’s proposed decision. In the three consolidated cases here, consistent with standard Department procedure, the prosecutor prepared a summary of the evidentiary hearing and recommended resolution, which he then provided ex parte to the ultimate decision maker or decision maker’s adviser.

While the state’s administrative agencies have considerable leeway in how they structure their adjudicatory functions, they may not disregard certain basic precepts. One fairness principle directs that in adjudicative matters, one adversary should not be permitted to bend the ear of the ultimate decision maker or the decision maker’s advisers in private. Another directs that the functions of prosecution and…